Yes, the more you zoom, the less pixels are combined.
The most impressive thing for me is the fact that they are using all available pixels when recording video.. almost all other phones (except the N8) use only part of all the pixels coming from the sensor
"All still photo cameras have the problem that the sensor has many more pixels than there are in HD video. But it is hard to read out all pixels of a still image (10 MP or more) 24, 25, 30 or even 60 times a second. Therefore, still cameras only read a small fraction of its pixels to make the video stream, known as subsampling or line skipping. The effect is a significant degradation of image quality in video mode: there is noise, line flicker, color moiré and the result is no match for HD content produced with so called 4k cameras or cameras with supersampling such as the Canon C300. Such cameras cost $15,000 or more (a notworthy exception is the Panasonic GH2 though which made it the camera of choice for serious video work on a budget).
And what shall I say? The iCamera does it too, not supersampling 8MP (C300) or 16MP (GH2) but supersampling all 33,593,616 pixels (16:9) 30 times every second! That's one billion pixels the iCamera processes every second. In a mobile phone. This is crazy!"
Video works very well for concerts..